Keystone millions: Who benefits?

Keystone XL isn’t pumping oil yet — and may never be — but in the Washington, D.C., political industry it’s already a gusher.

The TransCanada pipeline has been stuck in limbo for over half a decade now; last month, President Barack Obama again postponed a decision on the project, likely until after the 2014 elections.

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Yet in just a few years, the political debate over Keystone has exploded into an entire sector of the Washington influence economy. Funded by multibillion-dollar oil companies, labor unions and ultrarich environmentalists, the fight has filtered into every crack and crevice of the nation’s capital — all for a project some advocates on both sides privately concede wouldn’t be an environmental or economic game-changer.

From advertisements blanketing Metro stops near Capitol Hill and the State Department to TV commercials saturating the Sunday morning talk shows, to print and digital promos in this publication and others, Keystone has been virtually omnipresent. Well over 100 lobbyists have registered to lobby the issue. Top consultants from Obama’s campaigns have signed up on both sides. The pro-pipeline American Petroleum Institute holds regular war councils to plot strategy and has shelled out millions promoting the project; just this week, API spent more than $50,000 on radio ads promoting Keystone in states with competitive 2014 Senate races.

Longtime Beltway operators say the scope of the Keystone battle has grown to an astonishing scale — perhaps the largest ever for a standoff over energy and the environment, and at the very least one that rivals the years-long and decades-old fights over acid rain and Arctic drilling.

The largely symbolic nature of the Keystone issue makes the titanic spending involved all the more striking. Political observers and even some industry officials and activists question all the activity surrounding a project that — according to many estimates — wouldn’t create more than a few dozen permanent jobs or exacerbate climate change in a significant way.

That means this whole advocacy campaign is probably just a small down payment on what the country will see when the harder-edged energy issues — strict new power plant regulations expected from the administration this summer, or a renewed legislative debate on climate change — come into focus in the months and years ahead.

“All of this stuff has been through an arms race,” said Carl Pope, the former Sierra Club chief who has had a front-row seat for decades of environmental fights. “The biggest battles we fought used a fraction of the resources.”

For all the money flowing into the Keystone issue, said David Tamasi, a senior vice president at Rasky Baerlein Strategic Communications, there is “little space for new information or arguments” in the debate at this point.

“It’s become almost easier for the president and project proponents to fall into a comfortable partisan crouch, because the issue has been so defined along political fault lines,” said Tamasi, whose firm worked for a time on Keystone for the government of Alberta.

It’s difficult to pin down the exact cost of the Keystone saga, since nonprofit and private-sector advocacy groups don’t have to disclose their revenue and spending like conventional political campaigns. But the sum is clearly well into the tens of millions of dollars — and because the pipeline project remains frozen in place, that makes almost everyone involved in the political debate a winner.

Besides bankrolling TV ads and hiring an army of lobbyists, advocates on both sides of the Keystone fight have spent millions mobilizing the public — or at least creating the illusion of mass mobilization.

On the pro-pipeline side, that has meant setting up an array of self-described “grass-roots” groups with generic-sounding names — the API-funded entities Energy Nation and Energy Citizens, for example — to build public support through social media, advertising and petitions.

Nebraskans for Jobs & Energy Independence is another such entity. It was set up ostensibly as a vehicle for native Nebraskans to channel their support for building the pipeline. But the group’s ties to national organizations lobbying for the pipeline’s approval are extensive.

It was founded by a local labor official with LIUNA, the national builders union that supports Keystone; Michael Whatley, a lobbyist and executive for the Texas-based Consumer Energy Alliance, sits on the organizing group’s board. NJEI once listed a TransCanada official as an officer in its tax documents (that official is no longer affiliated with the group).

Barry Rubin, a former head of the Nebraska Democratic Party and the pro-pipeline group’s vice chairman, was candid about its role.

“Are we a front group for building the pipeline? Sure, proud to be,” he said in an interview.

Not all the front groups, shell entities and opulently funded “grass-roots” organizations are quite so blunt about their advocacy. API, the industry group with virtually unlimited resources, has established a slew of organizations aimed at drumming up Keystone support; API’s president, Jack Gerard, was inspired by the Obama campaign’s savvy Web and voter-mobilization operations, according to an aide.

API boasts a more than 23 million-person “grass-roots network” made up of individuals who have spoken or written on behalf of the industry, though it’s unclear how API arrived at that number. Groups such as Energy Citizens promote API talking points on their websites and tout testimonials that support the industry’s views on oil and gas. (Obama “needs to get off his hands on this issue,” wrote Joe B. from Colorado.)

Among the groups funded by API is Vets4Energy, which API says has 1,400 members (citing privacy concerns, the group declined to provide a member list) and has recruited veterans to press for the pipeline on Capitol Hill. Another is Oil Sands Fact Check, a group that aggressively rebuts assertions that the pipeline would cause environmental devastation. The latter group, run through the firm FTI Consulting, often sends representatives to anti-Keystone protests and emails reporters to highlight low attendance numbers.

Vets4Energy organized a recent pro-Keystone news conference with Nebraska Rep. Lee Terry and North Dakota Sen. John Hoeven. Both Republicans demanded action on the pipeline in front of a small handful of reporters — and a throng of Keystone-backing veterans associated with the group.

“The greatest generation conquered Nazi Germany in a little over four years,” Terry said. “But here we are, five years after the permits have been filed to build the Keystone XL pipeline, and we’re still waiting.”

Keystone foes with smaller budgets have nevertheless established national operations of comparable sophistication, often hiring brand-name Democratic firms to help. They have coordinated activities between national groups like the League of Conservation Voters and the Natural Resources Defense Council, and activist organizations like environmentalist Bill McKibben’s 350.org — often with the help of nationally known political consultants. McKibben’s group has paid thousands of dollars to the liberal PR firm FitzGibbon Media to amplify its message.

On its website, powerhouse Democratic firm Global Strategy Group touts its role in creating an umbrella coalition of anti-Keystone interests, dubbed All Risk, No Reward, which has held events and run television ads opposing the pipeline.

Acknowledging that “public opinion on [Keystone] is very mixed,” GSG’s online case study states: “GSG organized opportunities for experts to speak directly with top reporters and media outlets, planned and executed several high profile events, and earned top flight coverage in the nation’s most prominent print and broadcast media.”

Lower-profile groups have played an influential role in the pipeline fight: The progressive Bold Nebraska worked with state landowners to challenge Keystone’s intended route, while an eclectic collection of environmental and tribal groups calling itself the Cowboy and Indian Alliance gathered for an April protest on the National Mall — complete with teepees and horses.